IPA proposes venture capital fund

The Institute of Public Accountants has proposed the introduction of a publicly supported venture capital fund in an attempt to stimulate the entrepreneurial environment within Australia.

mitchell

February 18, 2016

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In its 2016-16 pre-budget submission, the IPA has recommended that the federal government introduce the venture capital (VC) fund by either providing a significant proportion of funds to assist VC managers to attract other institutional investors to publicly supported VC funds, or by becoming an institutional investor in a range of individual VC funds.

"This level of support by government to small business equity finance will improve small business innovation and entrepreneurialism," stated IPA CEO Andrew Conway.

"This critically needed support will also be a driver to identify and overcome hurdles to successful and profitable investment."

According to Mr Conway, many young firms are currently facing funding problems, particularly within uncertain technological or new knowledge environments, due to their "unattractive nature to bank lenders".

"It is a lost opportunity to the Australian economy when innovative firms with high commercial potential are constrained by the absence of external finance.

"Any government with a strong commitment to economic growth via research and development and investment which facilitates greater enterprise and innovation activity must ensure that early-stage venture capital finance remains available to high-potential, young firms," Mr Conway concluded.